I know if i make bad decisions with my business, my business goes under... no reason these crooks shouldn't face the same fate. but... the goverment really screwed up when they just gave these banks money without any explaination as to how they were going to use it. the money should have gone the cunsumers who were riddled with debt and trickeled up (not down) to the top people at the banks.
It's not by necessity guaranteed that banks will survive without government support, but I think we'll be able to survive if they do fail. It's not wise to prop up a failing system while screeching "We can't let it go down, or we're doomed!". Banks should face the music, and make better policy decisions if they want to remain operational.
The taxpayer should not have to subsidise banks, and most certainly not have to bail them out when mistakes caused by greed and incompetence sends banks into a tail spin. However, we all need to use banks and, if they were allowed to fail, they would take the deposits of millions of ordinary customers down with them – and no government can allow that. That’s why legislators in the US and Europe have put forward plans to restrict the banks’ activities to protect the interests of taxpayers and account-holders. However, the banking industry has fought these proposals tooth and nail because the new regulations would prevent them from playing fast and loose with their customers’ money, because a reduction in capital to gamble with will be reflected in a reduction in their bonuses. Their attitude is ironic, because the banking industry always blames lack of regulation, rather than their own failings, for the financial crash of 2008 but when new regulations are proposed they don’t want to know. No matter what the banks and their friends in right-wing political parties say, though, casino and retail banking divisions need to be ring-fenced so the next time an investment bank goes belly-up, the only people who will suffer is their own shareholders and investors.
Banks can survive without government support, because most banks survived before the FDIC was created. Those that did not survive didn't deserve to survive. A bank is a private institution and should be run as such. If a bank chooses to engage in risky activity, the bank should be accountable, not the American taxpayers.
Our country was started with capitalism in mind. The government getting involved in the banking system is not wise. The more the government gets involved, the more the people and businesses have to depend on them. This is socialism, and not the way for a society to thrive.
Even during the great Depression, banks still functioned and were able to survive without government money. Without government money, the banks would simply need to re-evaluate their business plans and find a new way to function as a business to still remain profitable. Failure of these institutions should be allowed under the free market system.
The U.S. economy was created in order to allow those who know how to run a business to continue to survive, and those who mess up to fail. We do not need banks that are constantly failing to be dependent on government money to survive. They will never function properly this way. The government needs to stay out, and the banks will find a way to function.
In my opinion, they need to be regulated by the government, where they can have some sort of oversight. There is no excuse for these banks to have to be bailed out. If they are managing money so badly, then I think it is time for the IRS to step in, and go through their books to see exactly what is going on.
If I had a successful business that had become so large that it was among the most important businesses in the country, I would be extremely disappointed in myself as a business person if I took government aid to survive. Private enterprise is not private if the government steps in to stop a business from going under. Free market forces should bring another business that was being run more efficiently to the forefront, and fill in the gap left by any company that was allowed to fail.
A bank that is "too big to fail" is exactly that. They should have the reserves to weather any situation, and the only reason that the banks did not was because they were reckless with the money entrusted to them by the public. Bailing them out is simply rewarding their reckless behavior and encouraging a repeat of the financial meltdown. The government is well within its rights to bail them out anyway, but then it has an obligation to the public, which government ostensibly serves, to ensure that the banks don't throw away public money and land themselves in trouble again.
So we believe that under the current system the banks should be under the control of some form of legislation, and should not be self regulated, our main view is that the current banking system in shareholders and making profit does not provide a safe environment for people to save their money and in the case of bank of date as shown in a recent tv show, companies can be ethical and still survive in the current climate and still provide the service their customers want.
Poor banking decisions brought many major financial institutions to the brink of bankruptcy and they only survived as a result of government intervention. As money making entities they make money off of debt; whenever debt is unable to be paid back, banks will not make money, and in a fragile economy it is always questionable whether debt can be paid back.
The best case is that banks should have a regulations that prevent them from merging with other banks and types of businesses that are hedge funds. They should just do business as a bank, lending money to businesses and people, and making their money from checking accounts and loans. They are not loaning now, but, instead, want to charge hidden fees and maintain credit card fees. This is not a proper business for a bank.
Back when the stock market crashed, the banks were unable to handle themselves, and they couldn't manage on their own. The only way they got back on their feet was because of the government. Banks need government help to regulate themselves, and to also provide security for their customers. Money isn't something that should be handled by any individual company. The government should regulate and control it so nothing bad happens.
As we have seen back in the early 90's when the savings and loan scandals caused many of these to fall, banks too are in danger of failing if they are poorly managed or run into scandals and issues that are too big for them to handle alone. They can also run into hard times where more money is going out than coming in, and they can't stay afloat.
The failure of a business points to weaknesses within its own structure that must be fixed. If the government does not recognize that but instead chooses to try and bail them out, then there will be no rethinking of the economy we are in. The modern economy should not depend on laws made during the Great Depression to fix it, but instead should allow these banks to fail and reorganize the financial institution to better be able to face the new problems in a global economy where service-based versus goods-based economies have a large gap. To allow for the continuing failure of the banks points to a lack of understanding of how economics really works as well, since this half-hearted attempts of government control will never get the results that either full laissez-faire markets or fully government-operated economies will produce.
Because Congress passed laws requiring financial institutions to lend money to unqualified borrowers, banks lost money. The idea that owning a house or business is a right is faulty. Congress assumes that it knows how to run businesses when it can't even monitor itself. Because of government interference, many people have lost their homes and have bad credit. Our government should not be able to control everything, and that is clearly the objective of this congress. We will not be free to make our own decisions in regard to a lot of matters if this is allowed to continue.
A great example of the fact that banks cannot survive without government support would be back in 1929 during the crash of the stock market. Banks couldn't handle themselves at the crash and when tons of people tried to get their money this caused banks to go under completely. Banks are a part of the economy and no matter their size when times get tough they need help from the government as well. If a bank is let to do things on its own it could fail and this could cause it to go under and that would be a good thing. That big bank employs a ton of people and has a lot of people's money and if it went away that would be a problem. We cannot forget that.
The banks would fail, don’t forget they already failed in the great depression. The problem is they should have, credit cards don’t do anything for people except put them further in dept. The banks should fail because the government shouldn’t support any form of business, or corporation.
Banks are destined to fail if they make risky investments.
Let’s say you work 40 hours in a week, and put all that money in the bank, legally the bank can take 90% of that money and earn from it. Why should they be able to earn from your money? It’s yours right?
Not only do they get to earn money from it, others get your money, and place it in their banks, the 90% of your hard earned money was passed to a whole different bank, and gets another 90% taken out, so on and so on.
Doesn’t this help the economy? Well in the sort run I guess, but if everyone were to use their money in the banks at the same time, it would create hyperinflation, because the government would be forced to print all of that money, money that wasn’t there to begin with.
Essentially the bank is making fake money, redistributing it, and profiting off it. They are creating a giant bubble, that grows over time as more and more money is placed in banks, and one day could pop if everyone took out their money from the banks at once.